Tag Archive for: Economics

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Uncovering the Truth: Five Poverty Myths vs Facts

Poverty Myths vs FactsDespite the increasing awareness about world poverty that has arisen from globalization and heightened media coverage, there are still many misconceptions about the true nature of poverty circulating in high-income nations. Millions of Americans continue to share beliefs that simply contradict evidence. The following are five poverty myths vs facts:

1. Myth: Low-income countries just don’t have natural resources.

Fact: Actually, most of the world’s developing countries have an abundant reserve of natural resources.

It was for that reason that the European nations who colonized in Africa and Latin America grew so wealthy from trading raw goods, such as tobacco or mined silver. The exploitation of these natural resources, which continues to happen to some degree today within the global economy, is why low-income countries have yet to benefit.

Even today, around 400 billion dollars in natural resources leaves the African continent each year.

2. Myth: There isn’t enough food to feed everyone.

Fact: It’s almost worse to think about, but we have enough food to feed everyone on the planet one and a half times over. Food just isn’t distributed fairly and efficiently. Rising food prices, national disasters and conflict all contribute to global hunger.

3. Myth: Impoverished people just need to have less kids.

Fact: The reason why people in low-income countries tend to have more kids is because they live in poverty. Prevention methods are often either culturally unacceptable or just unavailable. Studies have proven that educated, wealthier women have less kids— meaning that solving poverty could help with overpopulation.

4. Myth: Globalization is helping everyone. When the world economy booms, poverty will solve itself.

Fact: It’s a nice thought, but realistically most developing countries lag behind in economic growth. The recent improvements in global poverty reduction can mainly be attributed to China or India, who have experienced the most growth in recent years. However, for over half a billion people living in extreme poverty in unstable countries, the improvements have yet to manifest themselves— that number will grow without additional aid.

5. Myth: High-income nations are doing a lot to help low-income countries.

Fact: In regard to global poverty, this may be one of the most difficult realities for people to swallow. The average American believes that 25 percent of the budget goes to foreign aid, when in reality it’s less than one percent. Very few developed nations even meet their own standards for minimum foreign aid donations, much less give in full capacity.

Though these poverty myths vs facts may present a more sobering reality about the nature of global poverty, there is the hope that greater understanding is the key to developing greater solutions. As the final fact suggests, there is so much potential to do more and make an even bigger impact on those living in poverty today.

– Kailey Dubinsky

Photo: Pixabay

Statistical Exploration of the Poverty Rate in Algeria

Algeria Poverty RateA look at numbers alone illustrates gross inequalities in the Algerian economy. According to Trading Economics, the poverty headcount ratio at the national poverty line was 5.5 percent in 2011. Despite the statistic, 11.8 percent of the population lives in the slums, and the lowest 10 percent of the population share just 2.87 percent of the country’s total income. Although those living in extreme poverty account for only 0.5 percent of the population, 10 percent or almost four million citizens, are seen as vulnerable to falling back into poverty if any slight circumstantial variations work against them.

Currently, unemployment is one of the biggest factors leading to setbacks in improving the poverty rate in Algeria. The World Bank reports that unemployment increased to 11.2 percent in 2015 and has remained that way through population increases in 2016. High levels of unemployment also occur among women and youth at 16.6 percent and 29.9 percent respectively.

Combined with low oil prices and deteriorating living standards, tackling inequality has become increasingly difficult in Algeria. Many disparities exist regionally, with almost 75 percent of Algeria’s poor living in urban areas and working informal jobs. Looking beyond the blanket statistical figures that exist, regional disparities indicate that twice as much poverty exists in Algeria’s Sahara, and three times as much exists among the population living on the Steppe, a Mediterranean forest and woodland region of North Africa.

Moving forward, the United Nations and other organizations such as the Algerian League for the Defense of Human Rights (LADDH) are working toward improving early childhood development and nutrition, health coverage, implementing cash transfers and strengthening rural infrastructure to displace inequality and decrease the poverty rate in Algeria. In 2005, Algeria launched the UNICEF Unite for Children Against AIDS global campaign, and other campaigns and movements have progressed alongside those efforts.

A 2017 UNICEF analysis covering 11 countries in the Middle East and North Africa, including Algeria, Comoros and Egypt among others, has also led efforts to improve education, provide adequate housing, provide access to clean water and improve antenatal care and birth assistance.

Through political advocacy and policy implementation, solutions can be found and goals achieved to leverage inequality, continue moving citizens above the international poverty line and lower the poverty rate in Algeria.

– Katherine Wang

Photo: Pixabay

Programs Alleviating the Barbados Poverty Rate

Barbados Poverty RateSince the 1950s, the Barbados economy has been drastically overhauled. Transforming from a primarily agricultural economy to one that is primarily service and innovation oriented, Barbados has continued to modernize its economy over the past half century. However, a large part of its economy is based on the tourism industry – one that is notorious for slow growth – leaving 26.2 percent of the population unemployed.

The Barbados poverty rate stands at 19 percent for individuals. This is a significant increase from the 13.9 percent poverty rate reported in 1998, and it does not bode well for an economy largely dependent on foreign tourism. Though the poverty line has shifted in the right direction, with the average income increasing from $5503 to $7860, the country acknowledges that there is much work to be done.

To combat the rising Barbados poverty rate, the ISEE Bridge Project was started. The acronym ISEE stands for the four steps the government has identified as necessary to help reduce poverty in Barbados.

The first part of the program has already been completed: identification of vulnerable populations and people living below the poverty line who desperately need help. Next comes stabilization, or addressing the most pressing needs. Following stabilization comes enablement, where necessary skills are imparted. The final step of the ISEE Bridge Program is empowerment, or providing individuals with all the support they need to succeed and excel.

The ISEE Bridge Program began in 2015, has helped 30 families so far and will expand to serve more than 250 families. This program is a small portion of the initiative that has been committed to ameliorating the Barbados poverty rate.

Other facets of the initiative will address specific groups such as retrenched workers and at-risk youth aged 16 to 30. With a high Global Development Index score and firm commitments to the future of its people, Barbados is well on its way toward increasing living standards and alleviating poverty countrywide.

– Connor S. Keowen

Photo: Google

Why Is Ecuador Poor?

Why Is Ecuador PoorEcuador’s poverty rate was 36.7 percent in 2007 and dropped to 22.9 percent in 2016. These results show that 1.4 million Ecuadorians escaped poverty within nine years. However, many Ecuadorians still live in impoverished conditions. The question is: why is Ecuador poor?

Decreasing employment rates contribute to poverty among many Ecuadorians. Ecuador’s unemployment rate rose from 3.8 percent in March 2015 to 5.7 percent the same month in 2016. Economic slowdown and several companies increasing dismissal rates are two causes behind Ecuador’s growing unemployment problem.

Ecuador has also implemented regulations that are making the country’s labor market more rigid. The regulations eliminated hiring contract alternatives and could even cause economic slowdown. Ecuador’s economic model being based on public expenditure could contribute to a weakened economy, as well.

Natural disasters also contribute to Ecuador’s poverty. In April 2016, the country had an earthquake that killed more than 670 residents, injured 5,000 and left 80,000 homeless. The earthquake also exposed prolonged problems related to Ecuador’s poverty problem that cannot be easily solved. Rural areas are especially at risk, with poor water systems and water-borne diseases.

Ecuador’s poverty is carried from one generation to the next, resulting in 70 percent of the country’s children living impoverished lifestyles. Children International, a nonprofit organization, is teaching children valuable skills that can help them break the poverty cycle. The organization’s Social and Financial Education program, for example, teaches Ecuadorian kids how to be responsible citizens and save money.

Children International is also working to help Ecuador’s unemployed residents, especially the country’s 25 percent of unemployed teens. The organization’s “Helping Overcome Poverty through Education” (HOPE) Fund helps Ecuadorian teens afford college. Children International’s other program, “Into Employment,” provides job training and placement opportunities for participants.

Why is Ecuador poor? Because in addition to rising unemployment rates, many Ecuadorians overlook the economic benefits of conserving native forests. Fortunately, the country’s government has established a Socio Bosque (Forest Partners) program that provides Ecuadorian landowners and communities with economic incentives based on the number of forests they help to protect.

In Feb. 2017, Ecuadorians voted for a runoff election between two presidential candidates (Lenín Moreno and Guillermo Lasso) who had different approaches to reviving Ecuador’s economy. Moreno promised to build houses for Ecuador’s 191,000 poorest people, while Lasso promised to trim government spending and cut taxes. Moreno won the election and became Ecuador’s new president in May.

Why is Ecuador poor? Because natural disasters, economic struggles and poverty cycles can affect Ecuadorians and their families for generations. The problem could be remedied under Moreno’s legislation, especially with the president’s plan to provide housing for Ecuador’s impoverished residents. Children International’s efforts to educate Ecuador’s children could help the country’s future generations escape poverty as well.

– Rhondjé Singh Tanwar

Photo: Flickr

Why Bangladesh Is Poor

Why Bangladesh Is Poor
Bangladesh is still considered as one of the poorest countries in the world. One of the main reasons why Bangladesh is poor is the country’s hostile political beginnings and struggle for independence, resulting in the country’s lack of development.

In 1947, the British rule over India ended, and East and West Pakistan was established on either side of India. It wasn’t until 1971, after a nine-month war, that the Bengali nationalists won independence from Pakistan and became what is now known as Bangladesh. Today the country is a densely populated country of approximately 162 million people. The poverty rate in Bangladesh is reported at 31.5 percent.

One of the reasons why there are so many people below the poverty line in Bangladesh is because of the country’s struggle to become established. Bangladesh only became a country 46 years ago and the transition from being part of a co-existing country to an independent one has not been easy.

From 1975 to 1991, the country went back and forth between being ruled by a military coup and parliamentary government. Finally, in 1991, Bangladesh established a parliamentary system that is currently being used today. However, from 1991 to 2009, there was a cycle of two leaders that were running the country. One leader would serve two terms and then the other leader would serve the next two terms, causing instability in the country that did not allow focus on Bangladesh’s citizens.

There is a wide gap between upper-class and lower-class citizens in Bangladesh. This is mostly caused by cities such as the capital of Bangladesh, Dhaka, drawing people away from impoverished regions, leaving these areas to become even poorer. The distribution of goods is focused on these cities, which makes it more difficult for rural areas to make a living.

There are several reason why Bangladesh is poor. Even though there is some stability now and the GDP has been rising over the past few years, the lower classes still experience a lack of education, life expectancy and infant mortality rates that are concerning. These factors are what holds the country back from making advancements to become a developed country.

– Deanna Wetmore

Photo: Google

Papua New Guinea’s Poverty Rate

Papua New Guinea's Poverty RatePapua New Guinea is located just north of Australia. Approximately 39.9 percent of the population lives below the national poverty line. Papua New Guinea is considered to be one of the poorest countries in the Pacific. Rural poverty is especially prevalent, causing agriculture to suffer. The run-down health system exemplifies years of a less-than-successful governmental approach. Papua New Guinea’s poverty rate can be largely attributed to a lack of knowledge of effective farming methods and an uncommitted government.

Most of the citizens in Papua New Guinea rely on small-scale agriculture for their livelihoods. Around 75 percent of natives practice subsistence farming. Coffee production is one of the country’s main sources of revenue, and thus, when this cash crop fails to produce, the regional economy suffers. Productivity has been low because farmers lack sufficient training in techniques, and yields are averaging 30 to 50 percent of their potential. The same thing is happening with the country’s cocoa production.

The health system in Papua New Guinea is deteriorating quickly. Often times medical facilities will not have enough staff or resources to help sick citizens at a successful rate, especially in rural areas. Everything depends on supply, vaccines, surgical instruments, staff, pain management drugs and a suitable treatment area. Studies have found that only 36 percent of facilities have running water year-round, 29 percent did not have clinical supervision and 13 percent were deemed unsanitary.

Papua New Guinea’s poverty rate stems from sick citizens. When there is a health crisis in a country, foreign aid is taken from other necessary means to give towards helping the sick, which means there is no development out of poverty. Sick people prolong poverty because they are unable to contribute to the labor force. For the country of Papua New Guinea to advance successfully, its health care system must develop.

The problems afflicting citizens of Papua New Guinea are reversible. More effective farming methods and a sufficient health system are entirely achievable if the government proceeds with a committed approach.

– Lucy Voegeli

Photo: Flickr

Urbanization One of the Main Causes of Poverty in China

Causes of Poverty in ChinaIronically, China’s urbanization, which initially was seen as an improvement for the country’s economy, is now known to be one of the leading causes of poverty in China. The urbanization initiative, which began back in 2012, was pushed by the Chinese government to prompt new forms of growth for the country. Moreover, although the country experienced a slight improvement in poverty, there remain more than 252 million people living on less than $2 per day.

Looking for better-paying work, many farmers moved out of rural areas to urban centers. Due to their low skill level and lack of education, many of these workers are stuck taking low-level jobs. Moreover, with an increased cost of living, these workers are just swapping one low-paid job for another, causing an increase in urban poverty.

Furthermore, the Hukou system is set up so that these migrant workers can no longer receive government aid. The Hukou system is China’s household registration system that monitors and distributes government-provided services such as healthcare, education and pension.

However, the system is designed so that, if a person moves from their original region, then they forfeit their rights to these benefits. Consequently, rural workers who move to cities can no longer receive government-funded healthcare or retirement aid. Moreover, their children, if they move with them, no longer have access to education.

The most severe effects of the urbanization trend are found in rural areas. Often, it is the adults in rural families who leave to find work in cities, leaving behind children and the elderly. One-third of China’s rural students under the age of 16 have at least one parent who is a migrant worker, meaning many children get left behind.

Nearly 60 percent of children living in the countryside of China see their parents less than twice each year. These children are often left with grandparents who are either too busy with farm work or else too incapacitated to properly care for the children.

Though urbanization may be beneficial for some Chinese and is giving the economy a boost, it has been detrimental to many others. Migrant workers and those left behind in rural areas are struggling the most from the massive national migration. Because of this, urbanization is now one of the leading causes of poverty in China.

– Hannah Kaiser

Photo: Flickr

Andorra: Europe’s Tax Haven and Tourism Getaway

AndorraSituated in the mountains between Spain and France, it’s easy to forget about Andorra, one of the smallest states in Europe. Because of its duty-free shopping, winter sports and hot summers, it is a popular destination for the eight million tourists that visit annually. Travelers enter the country from either France or Spain, since it has no airport. The following facts and figures in Andorra paint a picture of prosperity and ongoing challenges.

  1. Andorra doesn’t get much press. This may be due to the small population (less than 100,000), and the actual area of the country is only about two-and-a-half times the size of Washington, D.C.
  2. Most of the country’s GDP comes from tourism and investments. The majority of employed individuals work in a service-industry position. The population enjoys a high standard of living. In 2016, unemployment was 3.7 percent. Poverty statistics are currently unavailable.
  3. Andorra has six major political parties. Additionally, there are several smaller parties at the parish level.
  4. Despite being so small, It also has a higher per-capita income than both Spain and France. It was a tax haven until France and Spain opened its borders. Andorra has no external debt.
  5. Andorra imports all of its food. Only 5.5 percent of its land is arable.
  6. Andorra is not without problems. One concern is affordable housing. While most of the housing in the country is new, it is also scarce. A look at lucasfox.com shows properties selling from 200,000 Euros ($228,000 USD) to well over a million Euros ($1,141,000 USD). Amendments to residency requirements have recently been made in order to open the market. It used to be a person buying property in Andorra had to have lived there for at least 20 years. Locals continue to live with their families in farmhouses.
  7. Environmental concerns included solid waste disposal, deforestation and overgrazing.
  8. In terms of health, nearly a third of the population is obese. According to 2014 statistics, 8.1 percent of its GDP (an estimated $3.327 billion as of 2015) was spent on health. Life expectancy is 82.8 years.
  9. Andorra is looking to attract foreign investing. Before 2008, non-residents could own 33 percent of a company. After living in the country 20 years, they could then own 100 percent of a company. This was due to concerns about foreign ownership on the economy.

As these facts and figures in Andorra show, it is a peaceful, small country as a retirement haven, or for those looking for an out-of-the-way skiing vacation.

– Gloria Diaz

Photo: Pixabay

What Does the Poverty Rate in Honduras Mean?

Poverty Rate in HondurasHonduras is one of the poorest, most vulnerable countries in the world. The poverty rate in Honduras is 66 percent. In rural Honduras, approximately one in five lives in extreme poverty; this means a salary of less than 1.90 U.S. dollars a day.

It is difficult to build businesses and add jobs in Honduras. A World Bank report ranked countries by ease of doing business and successful enforcement of contracts. The report ranked Honduras 125th and 179th out of 185, respectively. Violence has been one of the main obstacles to development and poverty reduction in Honduras. In 2011, the United Nations labeled Honduras the murder capital of the world. As of 2014, the homicide rate was still one of the highest in the world, at 67 homicides per 100,000 inhabitants.

The country is also vulnerable to national disasters such as hurricanes and droughts. The country struggles to mitigate these shocks and lacks risk management mechanisms and social safety nets.

Honduras faces the high levels of economic inequality. In rural areas, homes are small and dilapidated and animals and humans frequently live in close quarters. Many families do not have toilets or access to clean water, and access to medical care is limited.

The World Bank has implemented a new framework for aid in Honduras for the years 2016-2020. With a current portfolio of more than 990.5 million U.S. dollars, the World Bank Group is seeking to expand social programs, improve rural productivity, strengthen institutional capacity, strengthen resilience to natural disasters, increase access to financing and build the capacity of local governments to prevent crime and violence. Though the violence in Honduras shows no signs of ceasing, the international community will continue doing what it can to decrease the poverty rate in Honduras and provide people with essential resources. International aid could be pivotal to lowering the poverty rate in Honduras.

– Hannah Seitz

Photo: Flickr

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The Threat of Lake Victoria’s Failing State

Lake Victoria's Failing StateResponsible for over 35 million lives, Lake Victoria is a vital resource for the people of Kenya, Tanzania and Uganda. However, overfishing, pollution and mismanagement threaten its existence. The threat of Lake Victoria’s failing state is a danger to those who have built their livelihoods around it. Fortunately, there are multiple initiatives being implemented by humanitarian organizations to restore the lake and the people who live by it.

After coffee, Uganda’s second biggest export is fish. Lake Victoria gained international attention the 1980s when the native species of Nile perch and tilapia came into high demand. This fishing boom acted as an economic boost for fishermen, but it costs the lake severely.

Unfortunately, whilst the fishing boom was in full motion, the government’s environmental policies had yet to progress. Even when laws were implemented, they were scarcely enforced. Unregulated pollutants from agricultural run-off, sewage and industrial waste became a large contributor to Lake Victoria’s failing state.

With the pollution in the lake suffocating fish, desperate fishermen have resorted to practices that deplete the lake even more. Illegal fishing methods, such as using an insecticide as poison, have led to the destruction of breeding grounds. Fishermen use these techniques in order to catch more fish but add to Lake Victoria’s failing state.

While the average weight of a perch was 50 kilograms in 1980, it is now just 10 kilograms. Even more, about 300 smaller species have gone extinct. With the fishing industry in Lake Victoria producing about $640 million a year, it is vital to the 35 million who have built their livelihoods on the lake. However, it is being threatened by the environmental impact of pollutants.

Fortunately, there are many initiatives working to help both the fishermen and the lake. The World Bank started The Lake Victoria Environmental Management Project as an effort to both restore the lake’s environmental status and improve the lives of those who depend on it. One program this project is working on is providing income to fishermen through fish farms to alleviate the pressure on Lake Victoria.

This crisis occurring in Lake Victoria can still be solved. Until fishermen are educated on their impact on the lake and practices becomes more regulated, the problem will continue to grow.

– Kelly Hayes

Photo: Pixabay